“What if the elderly could swap home equity for long-term care?”

“Home equity release could be one way of helping to guarantee better living standards for the elderly, according to Mario Vella, the Governor of the Central Bank of Malta. Addressing the annual dinner of the Institute of Financial Services (IFS) Malta on Friday evening, Dr Vella said: ‘We have a situation where many elderly persons are asset rich but cash poor. They live on relatively modest pensions while residing in large and relatively expensive homes. ‘This creates issues for financing long-term care, as many find it difficult to sell their homes outright in order to go into a private home.’”

Swapping home equity for LTC or for LTCI premiums is a perfect solution I’ve advocated for many years. Instead, our government exempts up to $840,000 of home equity, anesthetizes the public to LTC risks, and traps them in welfare-financed nursing homes. Even Malta doesn’t do that.